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The IMA has finalised its fund cost disclosure guidance for members, urging them to publish average transaction costs in addition to the disclosure already required under UK and European law.

The fund management trade body has been under pressure for much of this year to improve transparency in fund costs, particularly regarding the costs of buying and selling underlying investments and the impact this has on end clients.

The IMA has also urged its members to publish an explanation of each type of charge on their websites, as well as using the ongoing charge figure instead of the annual management charge in fund literature and marketing. The ongoing charge was introduced under Ucits IV in place of the total expense ratio.

As well as taking responses from members the IMA also received input from consumer organisation Which?.

IMA chief executive Richard Saunders said: “The IMA’s new guidance is intended to benefit all investors and in particular those who want more detailed information about fund charges and costs. It offers more accessible disclosure of transaction costs, which are explained and disclosed separately because of their difference in nature from fund charges.

“The guidance has been developed with the input of firms managing over 50 per cent of retail funds under management and those firms remain committed to following it.”

Fund managers have been asked by the IMA to publish the disclosures on their websites by the end of March 2013.